Home / Business and Economy / UPI Fees Arrive: New Charges on Payments Over ₹2,000
UPI Fees Arrive: New Charges on Payments Over ₹2,000
15 Sep
Summary
- UPI payments over ₹2,000 will incur fees starting October 15.
- Person-to-person UPI transfers remain free of any charges.
- A flat ₹5 fee applies to specific essential services like fuel.
Effective October 15, 2026, merchants processing UPI payments above ₹2,000 will face transaction fees for the first time. The National Payments Corporation of India (NPCI) has approved a framework establishing these charges, with person-to-person transfers remaining exempt. This initiative follows recent legislative amendments allowing for such fees.
A 0.4% transaction fee, capped at ₹300, will apply to most person-to-merchant (P2M) UPI payments exceeding ₹2,000. However, four specific categories—railways, telecom, insurance, and fuel—will be charged a flat fee of ₹5, irrespective of the transaction amount. Public utilities and educational institutions also fall under similar flat-fee structures for transactions above ₹2,000.
The NPCI asserts that these measures are necessary to fund the UPI network's operational costs, including technology upgrades, cybersecurity, and expansion. While merchants are liable for these fees, the pass-through to consumers will depend on market dynamics and individual merchant decisions. The fees are generally lower than those associated with card transactions.
